I want to start delivery service, where to start??????????

[GotRocks]

We are primarily a BBQ restaurant, and have recently added pizza to our menu in mid 2013, even though pizza was in my original biz plan from 2009.
We are a small place, with limited parking, in a popular summer tourist destination. Due to our small dining area size, we are able to produce more than our seating, and carry-out volume allows, and I see delivery as a viable way to increase our sales without purchasing a larger property and moving a 3rd time in as many years.

I don’t have the first clue on how to implement a delivery service and I was hoping some of you guys could help point me in the correct direction.

I already use “Point of Success” premium, ver 3.0 with the updates, I’ve already installed the caller-ID module and it has been great for getting our call-in/carry-out orders organized. Does the mapping work well for you? Any tips on the POS for delivery?

What type of delivery radius do you keep? Whats a maximum distance or time limit for your delivery?
Are you paying “tipped Wages” to drivers, any legal issues that you’d care to share, and mistakes you’ve made that I should avoid?

The only place near me that delivers is Dominoes, we plan on delivering Pizza and our BBQ, Maybe drinks also.
Does your delivery pricing vary from in-house pricing? Delivery fee, or free delivery?

Employee owned vehicles or do you provide the delivery vehicles?
I’d like to get a pair of Cooper Mini’s wrapped with our logo and phone number, I’ve read here that many like the “Smart Car” for a delivery vehicle, but I am not too comfortable with those for a few different reasons.

Thanks in advance, I look forward to learning from you.

 

[wa_dave]

Re: I want to start delivery service, where to start???

Don’t do it.
If I could I would drop delivery as fast as a you would a hot coal.
You may/will increase your turnover but your costs increase, complaints increase, not to mention headaches, hiring and retaining staff, insurance etc.
Some guys will say go for it while others will voice similar to me but for what it is worth in extra sales the costs associated with delivery and the extra diligence required is not worth it.
Dave

 

[pizzanow]

Re: I want to start delivery service, where to start???

It’s a variable that gives me a headache just to think about, because of many of the things mentioned in the above post. But I know it has pumped up sales and probably paid for itself… and saved several slow store days from being, well, slow. There is a chinese place near us that does a ton of delivery service… people seem pumped they can order something besides pizza and get it delivered. I’d do it if I were you… and let everyone know they can get some great pizza and great bbq as well. Variety is the spice of life, and that mediocre chinese food place near me is proof positive.

 

[eupher61]

Re: I want to start delivery service, where to start???

Delivery can be a blessing or a curse. It depends on your mentality as an owner/manager, your business, your area, and the quality of your employees.

One local chain doesn’t hire drivers, they are pure and simple contract labor. The drivers sit and do nothing until a delivery comes up. They can’t work, they aren’t employees. So they hang out in the restaurants for no pay aside from a delivery fee and tips.

To me, not a good way to operate.

By all means, check out Hired Not Owned insurance for your company. It’s expensive, but frankly it will save your business should something happen. The cost of insurance may be a deciding factor in your pursuit of delivery. Many personal policies, especially from lower-cost companies, will cover nothing if the driver is using the car for business aside from their own. (Even a contract labor situation is technically not your personal business, according to our insurance guy. It makes sense.)
One wreck, even if serious injury isn’t involved, could be devestating.

That said, it’s a great service to your customers. The arguments of to charge, or not to charge, will go on endlessly. We do charge, in order to make sure the driver gets something for the trip. Callers often ask if that 1.50 is a tip, and the response is “that delivery fee goes to cover costs of the delivery, anything you’d like to add is appreciated” which is a very non-specific statement. For those who only have one vehicle, or work long hours and don’t want to cook, or just don’t want to leave the house but still want great food…those are your targets. Make sure you have good insulated bags (Ingrid makes great ones) and all your drivers have GPS of some sort. The indexed map books are terrific, and your county can likely make a big ol’ map with an index --but, the county map won’t have private roads.

Your insurance agent will give you all the details about driver requirements, and you’re wise to follow them. You’ll need to run checks on your drivers every 6 months or so–get written permission from them at hire–and be diligent in double checking for anything that could be a problem. The insurance company certainly will.

We have 2 drivers every evening, and weekend days. Weekdays, one driver and a manager or someone else who is covered. The drivers are also dishwashers and whatever else we need done. They often help in the kitchen, or bussing tables, or cleaning. We pay minimum wage plus delivery charge plus tips, not a bad deal for being able to get out and ride around periodically.

The first two months we were open, deliveries were frighteningly slow, something like 20 total the first month,30 the second. Now, 6 months in, we’re at about 10-12 daily at minimum. We still have a record of 28 in one day, which is not much. But, the drivers are much happier and we still have clean dishes. If a couple of lake developments in the area would change their entry method, we’d have a lot more deliveries. That’s another long story.

Does your competition deliver? Not just Dom’s, but the local Mexican or Chinese place? Take a hint from them, especially if they’ve been in business a while.

Good luck with whatever you decide!

 

[supachicken]

Re: I want to start delivery service, where to start???

We started delivery around 12 months into trading.

It does add a big chunk of revenue to your business it does add an element of stress, but that’s just business in my mind.

We charge $5/delivery - around $10k in just delivery fees in the first 6 months - enough to start funding some delivery cars.

We don’t deliver in peak hour traffic and we only take card for payment no cash.

If the service is what people want you should have no issue in dictating the terms in which you operate.

As far as drivers are concerned in my opinion it is just as hard to find good wait staff and pizza makers.

Good luck!

 

[bodegahwy]

Re: I want to start delivery service, where to start???

A few comments on the various issues raised in the posts above:

1. You absolutely, positively have to get hired and non-owned insurance. It is not required by law but you have to be nuts not to have it unless your greatest personal asset is your bicycle. It will cost you a fair amount of money. Best to look into it before you create your business plan for delivery.
2. Drivers can not be contractors. Ask your accountant and your attorney. Businesses that kid themselves that they can go this route are asking for trouble when that work comp claim or unpaid tax lien comes in. Unless there is a delivery service near you that provides that service for more than one restaurant, negotiates the fees, provides the hot bags and carries the drivers as their employees it is simply not going to meet the test for contractor status.
3. Delivery costs money. You either build those costs into your menu price model or you charge for delivery. Either way works but I think having different priced menus for dine-in and delivery would be a mess. One way or another you need to get paid for it.
4. We have a local BBQ place that does delivery. They do not make a big deal out of it and they have a $75 minimum order and a $5 delivery charge. Almost more of a light service catering program than delivery as I would think of it. Food for thought.
5. I agree with some of the other posts… delivery drivers are like any other employee to hire except you need to get driving records and verify insurance etc but no harder to find or keep. (Having your own delivery vehicle(s) will make it possible to hire employees who do not own cars which I find very helpful) Insurance for your own car costs the same as hired and non owned.
6. I would not deliver any further than about 5 minutes drive from the store if I could but in our town we need to go to about 10 minutes. Never mind the distance. It is time that matters.
7. We pay tipped wages. Our drivers make $6 per hour wage plus tips.

 

[GotRocks]

Re: I want to start delivery service, where to start???

Thank you for all your replies,

The area that I am in, there reaLLY IS NO “Peak Traffic TIME” IF THERE IS, i’D SAY we see it between Memorial day and Labor Day, then again around Christmas when they all come up in winter to go snowmobiling.

I think i’m going to get some insurance quotes, and try to make a decision from there.

I’m liking the “Minimum Order” idea being above $50.00, I may be able to pull a server to use my personal business truck for that kind of delivery.

I am on the intersection of a rural federal highway, and a state highway with Tons of motels and resorts on the main routes.

I’ll let you know what I come up with,

Thank you,

Care to share any personal horror stories??

 

[Daddio]

Re: I want to start delivery service, where to start???

GotRocks:

I may be able to pull a server to use my personal business truck for that kind of delivery.

Be aware there is a difference in the insurance requirements for this vehicle if you are going to use it for deliveries.

 

[famousperry]

Re: I want to start delivery service, where to start???

minimum order yes…$50 no…i use $10 but $20 would be the most

be careful whatever you decide to be consistent…customers do not like change

and of course do not forget to charge for delivery! most reasonable people understand that it is a service. Never liked the idea of FREE delivery and pricing it in so that it penalizes my dine-in & take-out customers.

good luck

 

[pizzanow]

Re: I want to start delivery service, where to start???

Hotels near by is good, but a minimum that high will not fly with those folks. My minimum is 15… and even some of the motels that carry my menu tell me guests are turned off by the minimum. A lot of people travel with work solo and just want something quick and easy… even if they are paying with company card.

 

[GotRocks]

Re: I want to start delivery service, where to start???

I like your comments on the minimum order, please keep them coming.

What I do not want to see start happening here is people demanding delivery on a $6.00 sandwich.
Since we are primarily a BBQ place that also does pizza, I’m hoping/thinking the minimum order amount may not be as much of a turn-off like it would be if we just did pizza.

Drinks, we offer fountain drinks and many varieties of premium soft-drinks, in glass, made with sugar.
Are you guys delivering 2-liters and 20 ounces mainly, or are you doing fountain drinks on delivery too?

Anyone use a “Take-Out Taxi” service?
There isn’t one by us, but I’m thinking it may be a viable thing up here in the summer months, mayeb this could launch a whole other side of our biz, who knows?

 

[Daddio]

Re: I want to start delivery service, where to start???

There are a few delivery services in my city. (Before I opened my shop, I ran one myself.) When I get calls from people who are outside my delivery area I will refer them to a service to arrange the details. The customer is told to call the delivery company to make sure they will take the delivery then call back and place the order. With these customers I do not enforce a minimum order amount as they are paying the full cost of the service. If they want to pay $7 to have a $4 order of bread sticks delivered who am I to stop them.